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62d Congkess, I HOUSE OF REPRESENTATIVES, j Document 
M Session. \ t No. 449. 



SALE OF COTTON TO CONFEDERATE STATES 
GOVERNMENT. 



LETTER 



THE SECRETARY OF THE TREASURY, 

RELATING TO 

PERSONS WHO SOLD COTTON TO THE CONFEDERATE STATES 

GOVERNMENT. 



January 13, 19] 2. — Referred to the Committee on Expenditures in the Treasury 
Department and ordered to be printed. 



Treasury Department, 

Office of the Secretary, 

WasJiingfon, January 6, 1912. 
The Speaker of the House of Representatives. 

Sir: My attention has been called to House resolution 333, intro- 
duced by Mr. Jacoway December 9, 1911, and referred to the Com- 
mittee on War Claims, directing the Secretary of the Treasury to 
prepare from records in his possession, either those of the United 
States Government or those of the late Confederate States, a list of 
persons shown to have sold cotton to the Confederate States Govern- 
ment, or to have entered into any agreement to sell cotton to said 
Government, and also to House resolution 349, introduced by Mr. 
Candler December 19, 1911, and referred to the Committee on 
Expenditures in the Treasury Department, which calls for the prep- 
arati(m and transmission of all the information s])ecified in House 
resolution 333, and in addition requires information whether the 
cotton sold to the Confederate Government was subsequently taken 
possession of by officers of the United States Government; and if so, 
the disposition of the cotton, the gross and net proceeds realized 
from any sales thereof, and whether or not the proceeds now remain 
in the United States Treasury, and also to show the cotton for which 
claims have been filed in the Treasury Department, and the names 
of persons by whom such claims were filed. 



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2 SALE OF COTTON. ' "^ .. . 

• 

The resolutions have a direct bearing upon the cotton claims which, 
under section 162 of the judicial code approved March 3, 1911 (36 
Stat., 1139-1140), were referred to the Court of Claims for adjudica- 
tion, and as this department is now actively employed in the work of 
collecting and arranging information for tiie use of the court in the 
trial of pending cases, it would seem that neither the interests of the 
claimants nor of the Government would be subserved by diverting the 
limited available force of the department from the completion' of the 
information desired by the court, to engage in the preparation of the 
data specified in the resolutions. 

The additional information required by House resolution 349 
intended to show the disposition of tlie cotton, the proceeds realized 
therefrom and now remaining in the Treasury with a report of all the 
claims for such cotton heretofore filed, would necessitate a further 
and separate examination of all Civil War records of the department 
pertaining to cotton transactions, and of all cotton claims heretofore 
filed in either the Treasury Department or the courts, to determine 
the claims in which the proceeds of the cotton were refunded by the 
Treasury Department under general and special laws authorizing 
such refunds, or paid to claimants upon judgments of the Court of 
Claims and other courts. 

The magnitude of the task suggested by the call for the mformation 
specified in the resolutions may be inferred from the fact that the 
records possessed by this department are very voluminous, and the 
task of preparing the proposed list of sales alone probably would 
require several months' time for its completion, as an exhaustive 
examination of all related records woidd be necessary to comply with 
that part of the resolutions directing that the statement shall show 
whether the sale was a completed one or only an agreement to sell 
and whether the price agreed upon had actually been paid by the 
Confederate Government. 

In explanation of this phase of the claims, it may be stated that 
when the sales were consummated the Confederate Government, not 
having storage facilities for the concentration of the cotton at depots, 
caused the sellers to contract to store and care for the cotton on their 
plantations and to deliver it at designated points on the order of the 
Confederate treasury department, and under such agreements the 
former owners have been regarded as bailees of the cotton. 

Much cotton of this character was thus in possession of the former 
owners at the time of the surrender of the military forces of the Con- 
federacy and was subsequently collected by agents of the United States 
and sold, and the proceeds placed in the Treasury. 

As payments for cotton purchased by the Confederate Government 
were largely made in Confederate bonds, rendered valueless as a result 
of the war, those persons who sold their cotton to the Confederate 
Government haA^e contended that the sale was incomplete in that they 
never parted with the possession of the cotton, and, moreover, that 
as the Confederate bonds received in payment were of no value, the 
sale was void as being without consideration. As most of these sales 
occurred in the years from 1861 to 1864 it may be observed that the 
department has no information of how the bonds were disposed of by 
those who received them, but it is probable that many of them were 
sold while such securities still retg-ined a marketable value. 



SALE OF COTTON". 3 

Congress by the act of March 3, 1911, supra, has committed the 
adjudication of the cotton claims to the Court of Claims, and the 
fullest information as to sales of cotton by individuals to the Con- 
federate Government will be furnished to the Court of Claims from 
the records possessed by the department so as to present the facts 
pertaining to each individual case, and as section 164 of said act of 
March 3, 1911, authorizes the court to call upon this department for 
any information or papers necessary in the prosecution of its business 
it would seem that the law sending the claims to the court for adju- 
dication to be there proceded in as in other cases contemplated that 
the procuring of all necessary evidence from departmental records 
should be conducted in the manner indicated in the law and under the 
rules of the court. 

Evidence that the cotton for which a claim is filed was actually sold 
to the Confederate Government is matter of defense to be offered in 
court for the protection of the interests of the United States, as 
required by section 185 of the judicial code, and, in my opinion, com- 
pliance with the resolutions, in advance of the filing of such claims in 
the Court of Claims, by disclosing the details of the Government's 
defense against the claims, would be injurious to the public interests. 

The many controverted questions of fact and law involved in the 
sales of cotton to the Confederate Government will be determined by 
the Court of Claims in the exercise of the full jurisdiction given to the 
court to adjudge said cotton claims, and full information from the 
records of the department relating to such sales will be furnished to 
the court in response to its calls made under said section 164 of the 
act of March 3, 1911. 

As the provisions of the law for the submission of evidence from 
the records of this department direct to the Court of Claims appear to 
meet every requirement for the adjudication of the cotton claims, it 
is believed that the specific data, when furnished as called for and 
desired by the court, will supply all necessary information as to sales 
of cotton to the Confederate Government and of all other facts of 
record pertaining to the claims in such form and detail as to present 
the complete facts of each individual case. 
Respectfully, 

Franklin MacVeagh, 

Secretary. 

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